Amal Ltd | Annual Report 2022-23 Explanatory statement The following explanatory statement, as required by Section 102 of the Companies Act, 2013 and Regulation 36(5) of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, sets out material facts, including the nature and concern or interest of the Directors in relation to the item number 3 mentioned in the accompanying Notice: Item number 3 Regulation23(4) of the Securities andExchangeBoard of India (ListingObligations andDisclosureRequirements) Regulations, 2015 (the Listing Regulations), requires approval of the members in case transaction with related party exceeds ` 1,000 cr or 10% of the annual consolidated turnover of the listed entity as per the last audited financial statements, whichever is lower (materiality transactions). From financial year 2023-24 corporate governance requirements became applicable first time to the Company upon exceeding the threshold provided in Regulation 15(2) of the Regulations. The requirements of corporate governance need to be complied with by September 30, 2023 and therefore approval of the members is required for entering into or continuing material related party transactions under Regulation 23(4). Considering the industry in which the Company and Amal Speciality Chemicals Ltd (ASCL), wholly-owned subsidiary company of the Company operate, both work closely with related parties to achieve business objectives and enters into various operational transactions with related parties, from time to time, in the ordinary course of business and on arm’s length basis. Annual consolidated turnover of the Company for financial year ended on March 31, 2023 is ` 6,132 lakhs. Amongst the transactions that the Company executes with Atul Ltd (Atul), related party, the estimated value of transaction entered into | to be entered into during financial years 2023-24 and 2024-25, may exceed the threshold and hence the transactions by the Company and ASCL with Atul will be material related party transactions. The Company is approaching the members for approval of the material related party transaction for financial years 2023-24 and 2024-25 as set out in the resolution. The transactions with Atul will help the Company and ASCL to achieve synergies and economies of scale and will be in the best interest of the members. Further, the transactions will help bring efficiency in operational and logistics costs, strengthen sustainability and leverage knowledge pool across functions. The relevant information pertaining to material related party transaction with Atul as required under the SEBI Circular No. SEBI/HO/CFD/CMD1/CIR/P/2021/662 dated November 22, 2021 is given below: No. Particular Details | information pertaining to transactions 1 Nature of relationship Atul Ltd is promoter company of the Company. Atul Ltd holds 49.86% equity shares along with Atul Finserv Ltd in the Company. 2 Nature, material terms, monetary value, tenure and particulars of contracts or arrangement Arm’s length at mutually agreed terms and conditions 3 Any advance paid or received for the contract or arrangement, if any Nil
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